Global healthcare cognitive computing market size was valued at nearly USD 738.5 million in 2014. Key growth drivers include information explosion of structured and unstructured data, technological advancements in the field of data mining and analytics, growing use of cloud services, and demand for personalized healthcare services.

The data which is stored in a structured format accounts only for 20% to 25% and the remaining is in an unstructured format. The digital data is available in the form of published articles, blogs, books, images, audio, and video and analyzing these data is a very challenging process and requires the use of high-level computing solutions.

Increasing disease burden due to chronic diseases such as cancer, diabetes, cardiovascular diseases is a major concern for governments and healthcare providers across the globe. The U.S. government's personalized medicine initiative along with other favorable regulations are likely to boost growth. As part of this program, huge patient data is expected to be generated and the demand for big data and cognitive computing analytics is expected to be very high over the forecast period.

The cognitive computing domain is gaining a lot of attention from players such as Google, IBM, Facebook, and Apple. These firms are actively scouting for potential start-ups and some recent acquisitions in the year 2015, include Google’s acquisition of DeepMind technologies, IBM’s acquisition of Explorys and Phytel, and PTC’s acquisition of Coldlight.

Furthermore, the cognitive computing technology has various applications in the healthcare industry and some key focus areas are oncology, personalized medicine, melanoma screening, EHR data analysis, medical imaging analysis, and management of other chronic disorders. The complexity in analyzing patient gene defects for a particular disease has been highly reduced due to the advent of cognitive computing and these applications are expected to positively reinforce market growth in the next seven years.

The healthcare cognitive computing market is segmented on the basis of technology as natural language processing, machine learning, automated reasoning and others. The advent of natural language processing and machine learning has strongly supported the growth of data analytics in the field of healthcare.

In 2014, natural language processing segment accounted for the largest share of nearly 45.0%.

The use of natural language for keywords has simplified the search process and helps in complex scenario planning and analysis. The end user can easily interact with the computer interface and feed enquires, train the system on how to handle specific data sets and derive meaningful insights.

However, automated reasoning technology is expected to be the fastest-growing segment, mainly due to high investments in this domain. This technology is used to understand the data context, complexity, and uses logical reasoning to derive meaningful insights which can be used to support business development and organizational growth.

End-Use Insights

Hospitals, pharmaceuticals, medical devices, insurance and clinical research organizations are the key end-users of this market. In 2014, hospitals accounted for the largest market share of approximately 40%. Key reasons attributing to such high usage include increasing demand for personalized medicine, gene-specific treatments, oncology and patient health record management. The cognitive computing solutions were first implemented on a trial basis in oncology, patient data management, and gene-based treatment, and therefore has been instrumental in high penetration levels.

By 2022, the pharmaceutical segment is expected to be the fastest-growing market. The use of big data analytics and cloud services has witnessed positive growth in the past few years and has created a platform for cognitive computing solutions. Increasing cost of drug discovery and clinical trials is a key factor boosting the usage of cognitive computing solutions over the forecast period.

Regional Insights

In 2014, North America accounted for the largest share of nearly 52%. Some factors supporting such high market share include the presence of high-tech technology firms, continuous investments in R&D, better reimbursement scenario, and high usage of information technology to reduce healthcare costs and improve patient care.

On the other hand, Asia Pacific is expected to be the fastest growing regional market over the forecast period. Growth in public and private healthcare expenditure levels, suitable demographic factors and faster technology adoption in this region are some encouraging variables associated with this market. Increasing government initiatives to support e-health initiatives, coupled with information explosion in the fields of cancer, genomics, and other diseases is expected to boost the demand for cognitive computing.

Company Market Share Analysis

The healthcare cognitive computing market is a rapidly evolving field and the competition for market dominance is very high. Some early movers in this technology include firms such as IBM, Google, Microsoft, Palantir, and PTC. In 2014, IBM has invested 1 billion USD to create its WATSON analytics platform, which can be used for oncology, personalized medicine, patient data management and several other applications. The IBM WATSON ecosystem includes several startup firms working to develop different cloud and app-based solutions for the healthcare sector. Furthermore, due to technological advancements, many new application areas for cognitive analytics are expected to evolve and positively reinforce growth over the forecast period.

Analyst Perspective

Cognitive computing is considered as the most advanced artificial intelligence platform, due to the use of natural learning, automated reasoning, and machine learning to solve complex problems and analyze unstructured data. The advent of big data, cloud, and mobile enterprises are transforming the healthcare delivery landscape. Healthcare industry generates huge data each year in the form of patient records, clinical trials, drug discovery and others and it is the biggest application area for cognitive computing in 2105.

To tap the market the software and healthcare giants are investing billions of dollars in these platforms, and this technology has gained significant traction due to the introduction of IBM’s Watson for oncology and patient data management platforms. This study highlights the industry dynamics, political and socio-economic factors impacting the market, and also presents an overview of the technology landscape, end-users and key players operating in the market.

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